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Revenue
₹1,770 Cr
verified against source
Revenue YoY
10.1%
reported change
EBITDA
₹330 Cr
latest reported figure
Source
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record provenance
Actual signal trajectory
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Quarter read
What the record says.
Fortis Healthcare reported a strong Q2 FY24 with consolidated revenue of INR 1,770 crore (+10.1% YoY) and operating EBITDA of INR 330 crore (+8.9% YoY). Hospital revenue grew 12% YoY to INR 1,456 crore, with hospital EBITDA margin improving to 18.4% (vs 18.2% YoY). Key drivers included 11.8% ARPOB growth to INR 2.21 crore, strong traction in oncology (27% growth), and international patient revenue up 15.6%. Brownfield expansion remains on track with 250 beds added this year and a total pipeline of 1,800 beds over 3-4 years. Management reiterated its guidance of 20% hospital EBITDA margin by FY25, supported by occupancy ramp-up and cost focus. Risks include potential delays in bed commissioning and elevated legal costs (INR 6-7 crore this quarter).
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Guidance to track
- Management reiterated its target of achieving 20% EBITDA margin for the hospital business in the next financial year, driven by occupancy ramp-up and cost control.
- The company expects to exit FY24 with occupancy around 70%, despite seasonal fluctuations and new bed additions.
- Brownfield expansions at Mulund, Anandapur, BG Road, and Ludhiana will add approximately 250 beds in the current financial year.
- Total brownfield bed pipeline increased to 1,800 beds, including new projects at Mohali (400 beds) and Shalimar Bagh, plus Manesar (350 beds) over 2.5-3 years.
Risks flagged
- Elevated legal costs of INR 6-7 crore in Q2 due to ongoing litigation; timing of resolution is uncertain and could continue to pressure margins.
- Analyst raised concern about rising guaranteed payouts for clinicians; management acknowledged some churn but deemed risk low. However, cost pressures could impact margin trajectory.
- Management identified potential delays in brownfield bed commissioning as a key risk to achieving FY25 margin targets.
- Rapid growth in medical oncology (lower margin) relative to surgical oncology could cap margin expansion despite absolute EBITDA growth.
Key quotes
- Our guidance is absolutely intact for next year.
- We are not leveraged at all. So we have a huge capacity, plus most of the CapEx, which is going to come for the brownfield expansion, 50% of it is from internal accruals and only 50% is on debt.
- I am expecting EBITDA margin of at least 30%-35% on this revenue brownfield expansion.
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